Contrasting Lavoro (NASDAQ:LVRO) and Adecoagro (NYSE:AGRO)

Lavoro (NASDAQ:LVRO) and Adecoagro (NYSE:AGRO) are both small-cap consumer staples companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, earnings, dividends, profitability, valuation and risk.

Earnings and Valuation

This table compares Lavoro and Adecoagro”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lavoro	$1.89 billion	0.12	-$152.49 million	($1.63)	-1.15
Adecoagro	$1.52 billion	0.53	$92.34 million	$0.35	23.13

Adecoagro has lower revenue, but higher earnings than Lavoro. Lavoro is trading at a lower price-to-earnings ratio than Adecoagro, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Lavoro and Adecoagro’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lavoro	N/A	N/A	N/A
Adecoagro	2.30%	3.24%	1.43%

Volatility and Risk

Lavoro has a beta of 0.46, suggesting that its stock price is 54% less volatile than the S&P 500. Comparatively, Adecoagro has a beta of 0.65, suggesting that its stock price is 35% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Lavoro and Adecoagro, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lavoro	2	1	0	0	1.33
Adecoagro	2	1	0	0	1.33

Lavoro currently has a consensus target price of $3.44, indicating a potential upside of 83.82%. Adecoagro has a consensus target price of $9.60, indicating a potential upside of 18.59%. Given Lavoro’s higher possible upside, equities analysts clearly believe Lavoro is more favorable than Adecoagro.

Institutional and Insider Ownership

2.5% of Lavoro shares are held by institutional investors. Comparatively, 45.3% of Adecoagro shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Adecoagro beats Lavoro on 9 of the 11 factors compared between the two stocks.

About Lavoro

Lavoro Limited operates as an agricultural inputs retailer. The company operates through three segments: Brazil Cluster, LATAM Cluster, and Crop Care Cluster. It distributes agricultural inputs, such as crop protection, seeds, fertilizers, foliar fertilizers, biologicals, adjuvants, organominerals, and others for the agricultural industry. The company also produces specialty fertilizers, crop protection products, and biological crop inputs. It operates in Brazil, Colombia, and Uruguay. The company sells its products through its physical stores and digital channel. Lavoro Limited was founded in 2017 and is headquartered in São Paulo, Brazil.

About Adecoagro

Adecoagro S.A. operates as an agro-industrial company in South America. The company mainly operates through three segments: Farming; Sugar, Ethanol and Energy; and Land Transformation. It engages in farming crops, rice and other agricultural products, dairy operations, and land transformation activities, as well as sugar, ethanol, and energy production activities. The company is involved in the planting, harvesting, and sale of grains, oilseeds, and fibers, including wheat, corn, soybeans, peanuts, cotton, sunflowers, and others; provision of grain warehousing/conditioning, handling, and drying services to third parties; and purchase and sale of crops produced by third parties. It also plants, harvests, processes, and markets rice; and produces and sells raw milk, UHT, cheese, and powder milk. In addition, the company engages in the cultivating and transforming of sugarcane into ethanol, sugar, and electricity. Further, it is involved in the identification and acquisition of underdeveloped and undermanaged farmland, and the realization of value through the strategic disposition of assets. Adecoagro S.A. was founded in 2002 and is based in Luxembourg, Luxembourg.